Apple: 10 million in iPhone sales is just the beginning

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Elaine Strauss, of San Francisco, is one of the first customers to leave with a new iPhone 6 from the Apple Store on Chestnut Street in San Francisco, Calif., on Friday, Sept. 19, 2014. The newest iPhone, the iPhone 6 and iPhone 6 Plus, went on sale today to long lines of eager customers. (Dan Honda/Bay Area News Group)

A man wearing a child on his chest (who declined to be identified) checks out the new iPhone 6 at the Apple Store on Chestnut St. in San Francisco, Calif., on Friday, Sept. 19, 2014. The newest iPhone, the iPhone 6 and iPhone 6 Plus went on sale today to long lines of eager customers. (Dan Honda/Bay Area News Group)

CUPERTINO — Consumers have already snapped up more than 10 million of Apple’s new iPhones, and analysts say the fast start for the bigger phones will mean bigger sales for the company for the rest of the year.

Apple announced Monday that the iPhone 6 and 6 Plus sparked record sales in the first three days they were available, besting the 9 million gadgets sold when the iPhone 5S and 5C debuted in 2013. But unlike last year, Apple reached a new high without China, where the devices have yet to win regulators’ stamp of approval, and supply appeared to be crimping sales where the new phones were available. That means Apple has most likely gleaned only a fraction of the riches its new iPhones promise, analysts say.

“There’s no question selling 10 million units of anything over a weekend is spectacular,” said analyst Avi Greengart of Current Analysis. “But that number just shows Apple’s supply. The demand is higher still.”

Indeed, Apple CEO Tim Cook suggested that Apple could have topped its own record by a wider margin, noting in a statement that sales for the opening weekend “exceeded our expectations.”

“While our team managed the manufacturing ramp better than ever before, we could have sold many more iPhones with greater supply and we are working hard to fill orders as quickly as possible,” Cook said.

Apple did not break down early sales between the two devices, but the 6 Plus, which boasts a larger screen, sold out early in many locations. Research firm Piper Jaffray surveyed customers waiting in line Friday in Minneapolis and New York, finding that 57 percent wanted to buy the 6 Plus.

Lines snaked around Apple stores in the Bay Area and beyond when shelves were stocked Friday. After netting about $7 billion from sales this weekend, Apple’s revenue may even cross the $200 billion threshold this year, thanks to a boost from the new phones, said analyst Carl Howe of 451 Research, though that will most likely happen in 2015. By comparison, Apple generated $171 billion in revenue in 2013.

“Apple’s going to have a monster quarter,” said analyst Colin Gillis of BGC Financial.

The iPhone 6 and 6 Plus come to market at a time when smartphones are already the norm, and many customers are ready for their next device, Greengart said.

“There’s an installed base that’s itching to upgrade,” he said.

Sales of the new iPhones began Friday in the U.S., Australia, Canada, France, Germany, Hong Kong, Japan, Puerto Rico, Singapore and the U.K., and will expand to more than 20 additional countries this week. Analyst Ben Bajarin of Creative Strategies said he expects Apple to sell its devices in China by year’s end, making for a “really, really big holiday season.”

“It’s going to be a very merry Christmas,” Howe said.

With its new batch of gadgets, Apple is entering the market for “phablets,” a popular category of devices that blur the line between smartphones and tablets. Samsung and other manufacturers using Google’s Android operating system pioneered the market, attracting some iPhone customers who wanted gadgets with bigger screens.

The iPhone 6, which measures 4.7 inches diagonally, costs $199 with a two-year contract. The 5.5-inch 6 Plus starts at $299 — $100 more than Apple charged for its premier phone last year. Those prices, roughly twice that of the average smartphone, will also enrich Apple’s bottom line, analysts say.

Many consumers find larger screens useful for watching videos and playing games. The size also makes the new phones easy to distinguish from early versions, satisfying consumers’ impulse to show off, Greengart said.

“Let’s not discount the impact of human nature too much,” he said. “It’s more obvious that you’ve purchased the latest.”

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